Our core forecasts for Bulgaria's power sector again remain unchanged this quarter. Limitedinvestment in new power infrastructure means capacity and generation are expected to grow only slowlythroughout the forecast period, leaving Bulgaria heavily reliant on coal-fired power plants and, to a lesserextent, existing nuclear facilities, which are being upgraded. Despite the slow growth, Bulgaria willcontinue to posit an energy surplus and will continue to export electricity via several major cross-borderinterconnections. There is some scope for renewed investor interest should reforms to the wholesaleelectricity market gain traction, however corruption remains a significant barrier to new developments andlimited domestic demand will also curtail growth potential.

Latest Updates And Structural Trends

- While the upgrade of Unit 5 of the Kozludy nuclear plant has been completed and work on Unit 6 isongoing, we do not currently factor the plan for a seventh reactor at Kozloduy - due to be completed in2023 - into our forecasts. If the proposal comes to fruition at all, it will likely do so after the end of ourforecast period, which runs to 2025.

- Prime Minister Boyko Borissov revived the possibility of restarting construction at the mothballed Beleneplant, proposing in August 2016 that a private sector partner be found for the 2000MW project. Theannouncement has all the hallmarks of a last resort, after the government tried, to no avail, to sell some ofthe completed components to Iran, in the immediate wake of a verdict by the International Court ofArbitration in June that Bulgaria would have to pay EUR620mn in compensation to Russia'sAtomstroyexport, for work undertaken earlier. The government's chances of finding private partnerswilling to stump up the remaining funds for the EUR10bn in financing appear remote, especially givenlimited prospects for growth in electricity demand and the fact Belene is in an earthquake prone zone.

Includes 3 FREE quarterly updates BMI View: Sri Lankan power generation is estimated to have grown to 13.90TWh in 2015, up 12.4% from 2014. Coal-fired generation grew at an 18.0% pace, with overall thermal ...

Includes 3 FREE quarterly updates BMI View: This quarter, we have slightly revised our forecasts to take into account the progress made in the nuclear segment. Gas-fired generation has been revised down ...